Utilities Are Influencing Solar Markets In New Ways

Renew Grid, Wednesday April 18, 2012 - 00:00:00

Solar power is the fastest-growing electricity source for utilities, according to a survey released by the Solar Electric Power Association (SEPA). In 2011, utilities interconnected over 62,500 photovoltaic (PV) systems.

SEPA's fifth annual Top 10 Utility Solar Rankings analyzes the amount of new solar power interconnected by U.S. electric utilities in 2011. It covers more than 240 of the most solar-active utilities, representing more than 99% of the U.S. solar electric power marketplace.

Thirteen utilities interconnected more than 1,000 PV systems, and 22 utilities interconnected more than 500 systems. This annual volume of smaller, distributed solar interconnections is unlike anything the utility industry has previously managed, and conservative forecasts indicate that this number will grow to more than 150,000 interconnections in 2015, according to SEPA.

However, the magnitude of these numbers poses strategic questions related to how utilities will physically process this volume of interconnection requests, how the distribution grid will accommodate this high-penetration growth, and how the utility and solar industries will resolve the economic implications of reduced sales of electricity.

The nation's most solar-active utilities integrated almost 1.5 GW of new solar - equivalent to six natural-gas power plants - breaking the 1 GW threshold for the first time.

In addition to the large number of PV systems, 15 utilities reported integrating more than 20 MW each, and eight reported integrating more than 50 MW each. While residential homes accounted for more than 89% of the installations, commercial rooftop installations accounted for more than 53% of the capacity.

These 2011 numbers represent a 38% growth in the number of installations and a 120% growth in the capacity installed over 2010. SEPA expects continued growth this year, driven by sustained price decreases and a build-out of large solar power plant contracts.

Much of this dramatic growth happened not just in the southwestern U.S., which has traditionally been the leader in solar power, but also in the eastern part of the country. The interconnections took place on the systems of municipal utilities, rural electric cooperatives and investor-owned utilities.

For the fourth straight year, California's Pacific Gas & Electric (PG&E) led all utilities in new solar energy added to its grid, with 288 MW. Half of the utility's portfolio included large projects, including three utility-owned projects totaling 50 MW and a power purchase agreement for the largest project completed in the U.S. in 2011.

PG&E also integrated more than 13,600 customer-sited projects. New Jersey-based Public Service Electric & Gas ranked second, with a 181 MW portfolio - a 142% increase over 2010. The utility's portfolio was 83% distributed projects and 13% utility-owned projects.

Rounding out the top 10 list of utilities that added the most solar in 2011 are Arizona Public Service (144 MW), Southern California Edison (138 MW), Atlantic City Electric (61 MW), Jersey Central Power & Light (53 MW), Sacramento Municipal Utility District (52 MW), Xcel Energy Colorado (51 MW), Long Island Power Authority (46 MW) and Xcel Energy New Mexico (45 MW). It took at least 45 MW to make the Top 10 list in 2011, more than double the minimum amount needed the previous year.

On a watts-per-customer basis, New Jersey-based Vineland Municipal Electric Utility took the top spot. A newcomer to SEPA's Top 10 list, the municipal utility ranked first in the nation with 769 watts per customer, after integrating approximately 19 MW of PV for its nearly 25,000 customers.

Georgia-based Blue Ridge Mountain Electric Membership Corp. and Tennessee-based Fayetteville Public Utilities jumped up the list, ranking No. 2 and No. 3, respectively. Both utilities participate in the Tennessee Valley Authority's Green Power Partners program. Blue Ridge Mountain is the sole rural electric cooperative utility in either of this year's top 10 lists.

SEPA's report depicts a rapid rise in the amount of solar interconnected on utility grids and a trend toward utility-led initiatives. A few years ago, the solar energy integrated into the grid was dominated by customer-owned, net-metered systems, but there is a marked shift toward the utility-side of the meter as utilities influence solar markets in new ways.

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